No. 14630 

IN THE SUPREME COUKL' OF THE STATl3 OF M3NTANA 

19 79 

LI'ITLE HORN STATE BANK, a 

hbntana Banking Corporation, 

Plaintiff and Respondent, 

-VSWW REAL BIRD, JR. and 

lw!DIw REAL BIRD, 

Defendants and Ap~llants. 

Appeal fm: District Court of the Thirteenth Judicial District, 

Honorable Charles Luedke, Judge presiding. 

Counsel of Record: 

For Appellants: 

D. Michael Eakin, Legal Services, argued, Hardin, Ibntana 

Steven L. Bunch, Legal Services, argued, Helena, Fkx&ana 

For Respondent : 

Clarence T. Belue argued, Hardin, Mntana 

Suhitted: June 11, 1979 

Decided: RUG -9 1979 

Filed: - 

A~G - ' !gp 
Mr. Justice John Conway Harrison delivered the Opinion of 

the Court. 

Plaintiff bank brought this action in Justice Court, Big 

Horn County, to recover money owing from defendant on certain 

promissory notes. The Justice Court entered a default judgment 

in favor of plaintiff. Defendant's motion to set aside the default was denied, and she appealed to the District Court. The 

District Court dismissed the appeal, and defendant appeals 

from the dismissal. 

In December 1977, plaintiff initiated this action in Justice Court to recover money owing from two loans made to defendant. Service of process was completed on defendant on 

January 10, 1978. On January 12, defendant appeared before the 

Justice Court and sought the court's assistance in negotiating 

a settlement. No written appearance was made nor was there 

any showing the defendant had an attorney at that time. At 

the suggestion of the Justice Court, defendant contacted plaintiff's attorney and tried to reach a settlement. She paid the 

attorney $150 on her account and left with the understanding 

that no action would be taken in the matter while she attempted 

to secure a loan to pay off the remainder of the indebtedness. 

On January 23, without notice to the defendant, the Justice Court entered a default judgment in favor of the bank and 

issued a writ of execution. The judgment did not give the defendant credit for the $150 paid by her to plaintiff's attorney. 

Defendant learned of the default when her only nonexempt asset 

was seized pursuant to the writ of execution. Defendant then 

contacted an attorney and filed a timely motion to set aside the 

default judgment, supported by an affidavit setting out defenses, 

counterclaims, and facts to show defendant was not required to 

file a written answer. The Justice Court denied the motion. 
Defendant then filed notice of appeal in Justice Court. 

She was unable to find sureties for undertaking, so she submitted an affidavit of inability to provide the undertaking. 

Plaintiff objected to the jurisdiction of the District Court 

to hear the appeal when no undertaking was provided. The District Court dismissed the appeal, and this appeal followed. 

Defendant presented two issues on appeal involving violation of constitutional rights, both state and federal. Due to 

the peculiar facts surrounding the entry of the default judgment here, we find it unnecessary to consider the two issues 

on appeal. Rather, we base our decision on Montana case law 

dealing with considerations similar to those presented in this 

case. 

In Brothers v. Brothers (1924), 71 Mont. 378, 383-84, 230 

P. 60, 61, this Court said: "No great abuse of discretion by 

the trial court in refusing to set aside a default need be 

shown to warrant a reversal, for the courts universally favor 

a trial on the merits." The Court went on to state it is preferable to dispose of cases on their merits than to maintain 

too strict a regard for technical rules of procedure. Brothers, 

71 Mont. at 384, 230 P. at 61. Here, the record shows the 

plaintiff took a default after the defendant felt she had been 

assured she would be given time to negotiate a settlement, and 

the judgment entered exceeds the amount defendant owed plaintiff 

at the time the court entered judgment by $150. Given the above 

rule favoring hearing cases of this nature on their merits, 

defendant should have her day in court. 

We therefore find the judgment erroneous and remand the case 

to the District Court of Big Horn County with directions to set 

aside the default entered and return the cause to the Justice 

Court for further proceedings. 
We concur: 

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